Correlation Between Grupo Carso and Ares Management
Can any of the company-specific risk be diversified away by investing in both Grupo Carso and Ares Management at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Grupo Carso and Ares Management into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grupo Carso SAB and Ares Management Corp, you can compare the effects of market volatilities on Grupo Carso and Ares Management and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Grupo Carso with a short position of Ares Management. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Carso and Ares Management.
Diversification Opportunities for Grupo Carso and Ares Management
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Grupo and Ares is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Carso SAB and Ares Management Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ares Management Corp and Grupo Carso is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Grupo Carso SAB are associated (or correlated) with Ares Management. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ares Management Corp has no effect on the direction of Grupo Carso i.e., Grupo Carso and Ares Management go up and down completely randomly.
Pair Corralation between Grupo Carso and Ares Management
Assuming the 90 days horizon Grupo Carso is expected to generate 1.0 times less return on investment than Ares Management. In addition to that, Grupo Carso is 1.78 times more volatile than Ares Management Corp. It trades about 0.07 of its total potential returns per unit of risk. Ares Management Corp is currently generating about 0.12 per unit of volatility. If you would invest 6,126 in Ares Management Corp on September 26, 2024 and sell it today you would earn a total of 10,804 from holding Ares Management Corp or generate 176.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grupo Carso SAB vs. Ares Management Corp
Performance |
| Timeline |
| Grupo Carso SAB |
| Ares Management Corp |
Grupo Carso and Ares Management Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grupo Carso and Ares Management
The main advantage of trading using opposite Grupo Carso and Ares Management positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Carso position performs unexpectedly, Ares Management can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Ares Management will offset losses from the drop in Ares Management's long position.| Grupo Carso vs. Diamyd Medical AB | Grupo Carso vs. CompuGroup Medical SE | Grupo Carso vs. AWILCO DRILLING PLC | Grupo Carso vs. SCANDMEDICAL SOLDK 040 |
| Ares Management vs. Grupo Carso SAB | Ares Management vs. MUTUIONLINE | Ares Management vs. CECO ENVIRONMENTAL | Ares Management vs. RELIANCE STEEL AL |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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